I Have an MBA in Finance But a PhD in Mezcal

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Del Maguey Acquired by Pernod Ricard!!!

Wow. Whoa. Holy shit. This week saw HUGE news in the mezcal world. Del Maguey Mezcal was acquired (a majority stake) by spirits industry giant Pernod Ricard. It is shocking, exciting, and troublesome to many as well. I’ll take the first two and pass on the third – not troubling to me at all.

First, a little background. Del Maguey, and it’s artist founder Ron Cooper, is the pioneering brand which brought the first premium mezcal to the U.S. in the mid-to-late 1990’s. Prior to the beginning of Ron’s evangelical campaign, mezcal was thought of as this worm-infused, gag-inducing swill only a frat boy could love. Del Maguey was largely alone in this pursuit for as long as ten years. It was not until the late 2000’s when other premium brands like Ilegal, Los Nahuales, Fidencio, and Pierde Almas, among others, began to show up in the U.S.

While certainly those brands, and a few others, have helped drive mezcal to where it is today, Del Maguey clearly got it started, and they are the number one selling mezcal in the U.S as a result. They have an army of industry supporters who prosthelytize the wonders of mezcal and Del Maguey, which has been awesome for the mezcal category. Their leadership, passion, and education-driven approach to mezcal has helped bring it to the forefront of the artisanal world of spirits. Sometimes I find the brand approaches mezcal with a bit too much reverence, but I cannot argue with the results. I too hold mezcal in high regard, but this is still booze after all! If we’re on a mission from god, let’s make it the Blues Brothers version. Mezcal is fun and sexy, cool and exotic, and an amazing tradition-laden spirit, so I don’t get too carried away.

And Del Maguey is REALLY good mezcal, especially their Vinos de Mezcal series and Single Village line-up. Their cocktail-oriented Vida is likely the main driver of their revenue, and no, it is not as good as their single village line-up, but it is also costs $35-$40 a bottle and works well in cocktails.

So that all said, it is a shock to see them sell the brand. The word from Ron is nothing will change in the way they operate the business, and they will continue to support and work with their palenqueros as they always have. And I have no doubt it is true because I know he and his team care so much about mezcal and what it represents. They would not do a deal with someone who did not subscribe to their world view, which is why this is not troubling to me in the least. Plus, I am a capitalist so more power to them. Del Maguey will now have more money and resources, and they will continue to produce their mezcal in an honest, sustainable way. For another take on this move, my friends at Mezcalistas posted THIS.

While Del Maguey is the first brand to be sold to one of the large spirit companies, there has been other action in the category. Bacardi bought a minority stake in Ilegal in February and Diageo has a distribution deal (and likely some equity stake or options) with Mezcal Union. Cuervo also has their own brand Creyente in the U.S. market, which they claim is made in an artisanal way, though I cannot say it tastes like an artisanal mezcal (I am stretching to find the nicest words I can). Nevertheless, the large spirit companies are approaching mezcal in the right way for the most part. They seem to recognize this is an artisanal product which cannot be industrialized.

I have a lot more to say on this subject and what it means for the future of mezcal. So this post is just a preview as spurred on by this huge industry news. You may not care about what else I am thinking, or you may be interested to know that I have already written a chapter on this very subject for my new book, the Revised Second Edition of Holy Smoke! It’s Mezcal!

Yes, I am revising the self-proclaimed best selling mezcal book of all time, Holy Smoke! It’s Mezcal! Is it really the best selling mezcal book of all time? Well, I am not really sure but it’s possible. And there really are not many books on mezcal so it can’t be that far off. I hope to have this ready to bring to market sometime this Fall.

So that’s it for now. Big news for the mezcal category and its continued growth. Thanks for reading and as always, drink mezcal!

All who commented respect and appreciation for your personal points of view.

Please allow me to post and share here my public statement regarding our family point of view.

Dear Mezcal Family,
Our team wishes to thank each and every one of you for helping us share and protect this ritual beverage for the last twenty-two years. And we look forward to continuing together, supporting this mission for many years to come.

I have received many inquiries and offers for investment into Del Maguey, but I have always said no thank you. We did not believe that anyone could ever completely understand, appreciate, or fully buy into our mission to preserve this culture, and to protect the ancient process of making Mezcal, and the indigenous artisan palenqueros that craft this elixir, or to embrace and appreciate their incredible liquid art …until now. Indeed, finally, after 22 years, we have found a true partner. A partner that understands exactly what Del Maguey is, a partner that wants Del Maguey to continue to be exactly who we have always been.

That partner is Pernod Ricard. After almost a year of getting to know one another, we have agreed to a partnership that will make Pernod Ricard a majority stakeholder in Del Maguey Single Village Mezcal. We will become part of the New Brand Ventures Division, a small group of entrepreneurial craft spirits companies.

It is important for each of you to know that the team at Del Maguey will remain intact. This includes all of our team in Mexico and the United States. And we will continue to operate Del Maguey as we always have. The liquid art of our palenqueros will not change. The only thing that changes is the increased opportunities for our families, and for our company.

I am personally pleased that we will continue to be the same. Perhaps most important to us, is that each of our palenqueros, each of the 12 families in 12 villages that work with us and that we support, some of whom have been with us from the beginning, none of whom have ever left us, will continue to be assured that they will be able to craft their liquid art in the exact same way that they have for generations. With the support of our new partners there is a sustainable future for their families and their communities.

We all want to acknowledge our friends at Sazerac for helping us to get to this point, by offering us the opportunity to be imported and distributed nationally, and we wish to thank them for several years of hard work helping us to build the Mezcal category. We continue to have great respect and admiration for the Sazerac family.

That said, we are honored to take our place as a key member of Pernod Ricard’s portfolio of premium spirits, and we are eager to work closely with them to continue Del Maguey’s incredible culture. We have seen firsthand their commitment to sustainability and social responsibility globally, and locally in Oaxaca, as they worked to increase the well-being of the community of Santa Ana del Rio and embraced and honored the local customs and traditions. We are confident that we are aligned, and that now, after 22 years, Del Maguey has found a likeminded partner committed to helping us to preserve this culture and ancient process, and support these amazing indigenous people, while helping us to continue to bring their liquid art to the world.

When PR brought my families distillery into their fold it was generally a positive experience. It allowed Maker’s Mark access to a distribution network that my father, Bill Samuels jr, used of to grow Maker’s into the global brand it is today. He was able to grow production without sacrificing the esthetics of the distillery, the taste of the Whisky and MM remained the highest paying employer and tax payer in the county. I believe this is the best opportunity for Del Maguey to flourish and become a global and responsible ambassador for Mezcal.

Wow. I love this commentary and contribution to the discussion. Congratulations on the success you and your family have enjoyed. As noted, I share your optimism and congratulate DM as well on their success!

One of the things I’ve heard time and again from distillers, whether in Ireland, Scotland or Kentucky, is that big corporate brass don’t always fully understand artisanal and hand-crafted spirits or the slow, methodical nature of their creation. These criticisms, more often than not, are directed at Japanese companies, but the big Euro giants probably get their fair share. Sooner or later, the company bean counters start pushing their spreadsheets, charts and graphs; and efficiency experts want things speeded up and more voluminous. I enjoy Mezcal daily, and I really hope that this doesn’t become an industry standard.

Hola, first of all thanks for all you have done and you are still doing in regards to the Mezcal category of spirits. Your book is inspirational and full of useful information. Now, as bar manager/bartender in Australia, big fan of Artisanal Agave Spirits and fully against the operations of big corporations (from fast food chains to giants of spirits industry), I must confess I was disappointed at first when I saw the news about Pernod Ricard and Del Maguey. I have no doubt in saying Del Maguey Tobala is the liquid that ever touched my mouth that makes me happier. My favourite drink in the whole entire world. Then I was heart broken with the news. Then you came with all this info and made me think a bit more, consider some other aspects and try to understand why they have done what they have done. Anyway, I am still not sure what’s going to happen with Del Maguey and Mezcal category as whole and I am still a bit concerned. But at least I can now see a light and still sit and sip my Vino de Mezcal… God bless Mexico!
P.S. I think you should include our bar in the Mezcal Joints list. We stock a solid range of Del Maguey, El Jolgorio, Nuestra Soledad, Alipus, Leyenda, Los Danzantes and other.
Stigibeu, Mauricio

Thanks for your thoughts. And yes, when I first had the DM Tobala it was a transcendent experience! I think DM will be just fine as I suggest. Ron and his team care deeply and will still be leading the charge. Only time will tell of course, but I predict continued excellence! And drop me an email about the Mezcal Joints list. I am at john@mezcalphd.com

At least regarding Mexico and sustainability, your capitalism and social optimism are at odds. Even laws with teeth aren’t enforced against those with power/money. Maybe there’s no guarantee mezcal will become a disaster of tequila proportions, but caution, at the least, is more than justified. Also in terms of diversity for the consumer, the beer industry has shown us that monopolistic forces are more than happy to buy up challengers if it helps undermine smaller, regional producers, and minimize “disruption” to the status quo.

Nice commentary as always and thanks for the Mezcalistas shout out. I too am an optimist and think there is room for all. The much maligned (and for the most part deservedly so says the mezcal biased one) tequila industry is showing that there is a market for mass and traditional tequila. The bat project alone is reason to have hope. But, it will certainly require diligence on our part to push brands to produce high quality, and as much as possible, sustainable mezcals.

Thanks Susan. Keep doing the great work that you guys do! And your tequila example is excellent. Brands like Fortaleza are blazing a beautiful artisanal trail and consumers are rewarding them. Brands like that were really retrofitted and started after all else became industrial. Mezcal is ahead of that curve as all are artisanal (well the ones to which we devote our efforts) so maybe, just maybe, mezcal is at a better launching point than tequila ever was. Certainly, tequila never had this focus against industrialization.

There is no way for true artisanal Mezcal production to keep up with demand. Even a small shift in Tequila consumption to Mezcal worldwide will wipe out the wild Agave stocks used to produce these “limited Edition” premium bottles. It’s just the nature of harvesting a wildcrafted product and attempting to go mass market with it. Increasing demand will kill it off quicker than collapse of the polinators required to keep the plants growing. Next step is 100% cultivated Mezcal sold as something else entirely. It’s a done deal, Mezcal’s popularity will destroy it.

Thanks for the thoughts and there are many that would agree with you. I am not so sure it is that cut and dried. Espadin is a cultivated agave now and there is a lot of land to grow more and brands are planting and planning. Almost every espadin we are drinking is from cultivated agaves, and the results are pretty damn good. The wild agaves are more challenging for sure. There are a lot of cultivation and semi-cultivation efforts now with many brands. The semi-cultivation efforts are taking seedlings and replanting them in the wild, which is great! Also, the CRM has issued guidance to “pick one, plant two”. Hard to enforce but in the right direction. All is not lost, and I am an optimist by nature so I believe….